France faces 14 BILLION-EURO black hole after it overestimates tax income in the last year

  • Francois Hollande has increased tax since he was elected two years ago
  • But profit from taxes were little more than half the 30bn-euro forecast
  • Court of Auditors said forecasts were wildly inaccurate and optimistic 
  • Follows criticism that the socialist leader's policies are halting the recovery
  • Unemployment also rose by 14,800 in April, a record under Hollande 

By Wills Robinson

Published: 11:19 EST, 28 May 2014 | Updated: 04:29 EST, 29 May 2014


Francois Hollande is facing further criticism after tax income from 2013 was little more than half what politicians had forecast

Francois Hollande is facing further criticism after tax income from 2013 was little more than half what politicians had forecast

Francois Hollande is facing more criticism tonight after it emerged that France could have a 14billion-euro black hole in its public finances after hugely overestimating tax returns.

Following a week that has seen his position weakened further by the National Front's European election victories, statistics revealed last year's receipts from income tax, VAT and corporation tax were wildly inaccurate.

The President raised the tax when he was elected two years ago, but the surplus from 2013 was only half the 30billion-euros that was forecasted.

The Court of Auditors, which oversees the government's accounts, said the revenue projections in 2013 were wildly inaccurate, overly optimistic and based on inaccurate projections.

Last week French Prime Minister Manuel Valls appeared to criticise Hollande's tax policy by suggesting: 'Too much tax kills tax'.

According to the BBC, opinion polls put Mr Hollande's approval rating below 20 per cent and critics say he is hurting France's economic recovery.

Public spending in France is among the highest in the world and is due to hit 57 per cent of national output this year.

Earlier this month, the IMF warned politicians that high taxes were holding back the recovery after the French economy ground to a halt.

Since Hollande's austerity measures were brought in, unemployment rate has hit a record high of 11 per cent and economic growth has been inconsistent.

 

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In April the number of people without a job grew by a further 14,800, a new record, undermining Hollande's campaign to bring unemployment down.

The Socialist leader has said he would not run for re-election in 2017 if unemployment does not fall by the end of his term.

Official statistics by agency Eurostat also stated that output in France stagnated between January and March following just one quarter of growth at the end of last year.

Opposition: The French President's position was undermined this week after France's National Front Party, headed by Marie Le Pen (pictured) surged to victory in the European elections

Opposition: The French President's position was undermined this week after France's National Front Party, headed by Marie Le Pen (pictured) surged to victory in the European elections

Stagnation in the first three months of the year contrasts with growth of 0.8 per cent in both Britain and Germany.

The Spanish economy grew by 0.4 per cent but output sank 1.4 per cent in the Netherlands, 0.7 per cent in Portugal and 0.1 per cent in Italy.

The income tax threshold for France's wealthiest citizens was raised to 75 per cent last year, prompting some French citizens, including the actor Gerard Depardieu, to leave the country and seek citizenship elsewhere in Europe.

Mr Hollande has already said he will not slow the pace of deficit reduction, adding France 'cannot live with such heavy debt'.

He hiked taxes when he came to power in 2012 having vigorously campaigned against austerity across Europe.


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He certainly did overestimate tax income. All the high payers have left. Who would have seen that coming?

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Socialist math

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Go to work you s!!!&!

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oh la la oops!!

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So it seems that Socialists are not good at math?

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Okay first the underestimated railway size, and now This.

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Milliband is financially naive whilst Ed Ball is fiscally illiterate. The fact that they are both admirers of Hollande bodes ill for the UK should these clowns get anywhere near No.10 next year.

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Its been coming for a long time, I trust that the French people will suffer a "Haircut" in the same way that some in Cyprus had their bank accounts raided! After all, Germany has said that ALL future black holes should be resolved by "bailing in" the populace. Would be interesting to see the reaction if this was even suggested,

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If they had the franc they could have devalued making products competitive instead of making the Germans products cheap.

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so did the civil servants do this by accident?

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